I'm 2iC of 2 factions, [HF] and VWA. There's a world of difference between the hierarchies of those two factions which I find pretty interesting so I'll just analyse them both and then give my own conclusion.
In the VWA the ranks have little meaning oorply. We have 4 ranks but the difference between the highest two is only in-RP. For example I now hold the highest rank as party leader of the Bundschuh, but oorp I'm only 2iC. LunaticOnTheGrass is the actual leader. Aside from us two there's only 2 other ranks. One is just the normal rank for most players. The other is given to a variety of people: old members (such as those who helped found the faction) or people who have shown a lot of potential and dedication who might at some day become the new 2iC or leader.
Most of all our ranks are for RP however. Heck sometimes I make up some small secondary ranks for chars like quartermaster.
Oorply, there's not even a separate HC in VWA.
When it comes to restrictions, VWA restricts some ships, but that restriction is completely independent of the ranks. Instead some tech as well as GBs is granted by me or Luna and is most of all just dependent on whether the RP background for it makes sense. This also counts for our use of RM tech. We technically don't restrict that at all, but it's just unwritten policy to only have ex-lawful chars fly lawful stuff (except a few shared ships).
HF is worlds apart from this. HF is very hierarchical. There's High Command ranks, fleet command ranks and enlisted ranks. If you do well you get promoted, if you screw up you get demoted. It depends on the leader how much power the HC has. I remember back in 2011, HC actually voted on or discussed almost all matters. The leader at that time was not very active and HC pretty much did all stuff. On the other hand under Charos's leadership which lasted till shortly after our regained officialdom, HC was merely advisory as Charos did everything himself.
What remains the same, regardless of the leader, is that the ranks have a lot more importance in HF than what I'm used to from other factions. Ship restrictions too are completely dependent on ranks. There's no personal capitalships in HF, but quite a few shared ships and who can use what depends on rank. Even people who may use battleships sometimes can for example only use a shared Arbiter, but not our flagships.
Being 2iC of both these factions and involved with them for a long time I've of course got my preference over one style or the other. That being the VWA's style. It's a system that is very relaxed oorp and doesn't make playing a game feel so serious. On the other hand it has provided the best in-RP intrigues I've encountered so far with the eternal rivalry between Luna's char and my own.
However I also feel like if one would apply the hierarchy of either faction to the other, it just wouldn't make sense. A more loosely organised, HCless HF just wouldn't be HF. Perhaps because the oorp feeling also adds to the in-RP feeling. A rebel navy is just not the same as a ragtag band of student activists.
tl;dr how factions are organised both in-RP and ooRP is part what makes every faction unique. I prefer a loose organisation, but with some factions their strictness is just part of how they are.